In theory the exposure is less but the numbers are still substantial. Add to this the ongoing soft economy plus the fundamental weakness in the financial sector, the fat profits are likely to be hard to find in 2012. NY Times:
Five large American banks, including JPMorgan Chase and Goldman Sachs, have more than $80 billion of exposure to Italy, Spain, Portugal, Ireland and Greece, the most economically stressed nations in the euro currency zone, according to a New York Times analysis of the banks’ financial disclosures. But these banks have made extensive use of a type of financial insurance, called credit default swaps [cnbc explains] , to help them offset any losses that might occur if defaults swamped the five troubled nations. Using these swaps, along with other measures, the five banks have cut their theoretical exposure to the troubled countries by $30 billion, to $50 billion. The analysis also shows that Citigroup has the greatest percentage of its exposure potentially protected at 47 percent, while Bank of America has bought the least protection at 12 percent. Big banks have reduced their sovereign debt exposure, but they still have tens of billions of dollars of it.